NewsWatch: Summary of Top Stories - 06-12-98

CBS.MarketWatch.com

NEW YORK (CBS.MW) -- Energy
$xoi
and healthcare issues led the market back from the depths of another broad selloff late Friday, as another dose of Asian-inspired earnings jitters wracked U.S. shares for most of the session. As a result, blue-chip averages closed the day marginally higher despite moderate losses in small-
RUT, +0.12%
and medium-sized names.
$mid
The Dow Jones Industrial Average
DJIA, +0.72%
advanced 23.17 points to snap a three-day losing spell. "If the market goes even lower, I think the pullback will be relatively mild," said William J. O'Neil, chairman and founder of Investor's Business Daily, and president of William O'Neil & Co., a Los Angeles-headquartered institutional research firm.

NEW YORK (CBS.MW) -- General Motors' shares shifted into reverse as the strike at the world's largest automaker spreads, but analysts said that the company's stock is still a good long-term buy. Shares of General Motors (GM)
GM, +3.40%
, a component of the Dow Jones Industrial Average, fell amid signs that GM could face a total shutdown of its 28 wholly owned major assembly plants in North America with 296,500 hourly workers.

Japan Report: Recession! . . .

NEW YORK (CBS.MW) -- The GDP figures from Tokyo served as official confirmation to what many investors had already seen coming through the weak yen and Asian market volatility: Japan's mighty economy is in recession. Growth in the country contracted by 0.7 percent over the past 12 months, according to Japan's Economic Planning Agency. The key report was released after the Tokyo stock market closed, but stocks tumbled 8.1 percent in South Korea -- Japan's export rival-- on the news.

It's a bear market for shareholder suits . . .

SAN FRANCISCO (CBS.MW) -- Pity Bill Lerach and his litigious brethren. The San Diego-based attorney has won fame and fortune as one of the most active and successful lawyers in the field of shareholder lawsuits, particularly those alleging companies hid bad news while insiders dumped shares. His firm, Milberg Weiss Bershad Hynes & Lerach, has sued more than 50 companies, mostly technology companies that tend to have volatile stock prices. But the times, they may be a'changin -- for the first time since the 1929 market crash.

Goldman Sachs partners to discuss IPO plan . . .

NEW YORK (CBS.MW) -- Goldman Sachs's 190 partners are meeting over the weekend on a proposal to crack open the last large investment banking partnership on Wall Street. The 129-year-old bank is mulling an initial public offering that would value the firm at $30 billion, or at about 3.5 times book value, The Wall Street Journal reported. The move would enrich Goldman's junior partners as well as the senior partners.

U.S. producer prices inch up 0.2% . . .

WASHINGTON (CBS.MW) -- In another sign of the benign inflation climate, U.S. prices at the wholesale level rose a tad faster than expected last month, the government said. The Producer Price Index, along with its core rate excludes the volatile food and energy sectors, rose 0.2 percent, exactly mirroring April's increase of 0.2 percent. Separately, the government also said the nations' businesses kept adding to their inventories of unsold goods but at a slower pace in April. Inventories rose 0.2 percent while sales fell 0.1 percent, the Commerce Department reported.

Institutional investors top $14 trillion . . .

NEW YORK (CBS.MW) -- Led by the boom in mutual funds, U.S. institutional investments topped $14.3 trillion in total assets in 1997, the Conference Board said. That's up from $12 trillion at the end of 1996 and $6.3 trillion in 1990. In the last seven years, institutional assets have increased more than 125 percent, rising 14.5 percent from 1995 to 1996, and another 19 percent from 1996 to 1997, according to the New York-based business research group.

NEW YORK (CBS.MW) -- Now here's a new one: An Internet stock that doesn't soar on its first day of trading. While Internet ad management software developer NetGravity (NETG)
netg
didn't exactly come crashing to Earth on its first day of trading, it wasn't a high-flier, either.The stock opened for trading only 2.8 percent above a $9 offering price that was at the low end of original expectations of $9 to $11. Compare that to the average 30 percent first-day gain for the 31 Internet-related IPOs so far this year, according to statistics from CommScan's EquiDesk.

Getting Personal: A new way to car shop . . .

SAN FRANCISCO (CBS.MW) -- It sounds like a dream come true: you can get a great price for a great car without the hassle of dealing with those pesky salesmen. And it's all at the tip of your fingertips through your Web browser. The problem? Consumer advocates say online car buying isn't all it's cracked up to be, and car buyers might not be getting the best deal.

NEW YORK (CBS.MW) -- Dan Borislow, chairman and CEO of Tel-Save Holdings Inc. (TALK)
TALK, +3.45%
said America Online (AOL)
aol
members using his discount long distance service used as many minutes in the month of April as they did in the first three months of the year combined. "I anticipate in August we will have approximately twice the amount of minutes used compared to the month of April," he added. Tel-Save and AOL announced a multi-million dollar marketing agreement late last year.

Best of Wall Street: All the best analysts . . .

NEW YORK (CBS.MW) -- Our special series looks at the key people who shape your investments and move the market. We've got all the top analysts for every sector from technology to media. Find out through our interviews and analysis what drives the insiders who drive the market.

Best of Wall Street: StockWatch: Now is time to shop American . . .

SAN FRANCISCO (CBS.MW) -- Asia's endless storm won't get relief from Japan, our experts say. The nation suffered its first full-year decline in economic output since 1974. For U.S.-based investors, the best advice is to stick close to home. (See our report.) Now is the time, in other words, to invest in that Oregon bicycle parts maker, California Internet company or Midwestern candy maker.

Soapbox: Investor Business Daily's O'Neil talks stocks . . .

LOS ANGELES (CBS.MW) -- William J. O'Neil, chairman and founder of the newspaper Investor's Business Daily, gives his interpretation of the market, which he says is "in a downtrend that hasn't really come out of the downtrend." Still, O'Neil, who is also president of Los Angeles institutional research firm William O'Neil & Co., sees the decline as "relatively mild" and remains positive for the end of the year after a potentially bumpy next few months.

BALTIMORE (CBS.MW) -- Stocks down, bonds up . . . this wasn?t supposed to happen. Interest rates are coming down and stock multiples normally expand when that happens. So what?s different this time? In a word: Asia, again. As a matter of fact, this is the third hit from Asia, so it might be time for investors to turn to U.S. companies with dependable earnings.

Kellner: Japan's woes border on depression . . .

NEW YORK (CBS.MW) -- Despite dropping more than 10 percent against the U.S. dollar this year to an eight-year low, the Japanese yen isn?t likely to reverse direction any time soon. This is because the Japanese economy, which the yen reflects, is extremely weak and getting weaker day by day. Indeed, it is not unreasonable to compare Japan today with the U.S. in the early 1930s, at the start of the Great Depression:

Erdman's World: Japan's yen crisis . . .

SAN FRANCISCO (CBS.MW) --In my CBS.MarketWatch.com column of April 29th, I asked the questions: What if there were a relapse in Asia? Would our markets continue to just shrug it off? And what is the potential for such a relapse? My answer to the last question was: "It could take only the Japanese yen slumping to 145 to the dollar, the devaluation of the Chinese renminbi, or intense social unrest in Indonesia-- all real possibilities - to lead to another meltdown . . . and send a tentatively mending Asia back to the operating table." We may now see all three happening, one after the other.

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